Cross-Section

"Surprisingly good," said many a banker last week after inspecting the reports which told of U. S. Industry's struggle to eke profits out of Depression. Although the first half-year was marked by further profit shrinkage, the general tone of the reports indicated that most companies have the situation in hand, are busy effecting economies which will make profits bigger when business revives.

Seldom have earnings statements caused such excitement as those last week; seldom has such a cross-section of the ups & downs of business been offered. Lacking were the corporate high comedy which marked the last of prosperity and the melodramatic tragedy which came with the first wave of Depression, yet each report was the record of a dramatic six months.

The first 180 corporations to report showed a 25.7% decline from last year. Nine rails dropped 65.1%, five utilities jumped 4.8%, 166 industrials were down 32.2%. Colorful specimens included the following:*

P: Far & away the most notable of corporate achievements was the second-quarter showing of General Motors Corp. Industrialists and financiers hailed it as the product of President Alfred Pritchard Sloan Jr.'s shrewd managerial ability and the driving sales force of Richard H. Grant whose radiating enthusiasm built Chevrolet's sales from 314,000 cars in 1924 to 1,001,000 in 1927. Although during the June quarter GM sold 2.5% less cars than in the corresponding 1930 period, the net income of $55,122,000 was $1,736,000 higher than in 1930. For the half-year GM earned $84,122,000 against $98,355,000, or per-share earnings of $1.83 against a $1.50 dividend requirement. Although the second half is the harder one for motor companies, GM enters the final stretch with working capital of $328,000,000 against $290,000,000 a year ago. If working capital is the backbone of a company, cash is its sinew. GM has $245,000,000 deposited in banks and invested in Government bonds.

P: Momentous was the meeting of United States Steel Corp.'s directorate last week. Solemnly directors looked at the half year's result, a paltry $14,156,412 equal to 17-c- per share for the common against $6.46 per common share in the same period last year. Almost the entire sum reported for the second quarter was profit on sale of property, operations yielding only 7-c- a share on preferred stock. Tremendous as is the unappropriated surplus of $465,000,000, directors felt it would be folly to continue $7 dividends equal to $60,000,000 a year; cut it as an unpleasant surprise to the rate of $4 per share, less than in any year since 1915, when no dividend was paid. Directors hinted their attitude toward the moot question of wage reduction by recommending a cut in salaries.

P: Vice President and Treasurer Fred A. Powdrell of Montgomery Ward & Co., Inc. has had a year to demonstrate his highly rated ability and President George Bain Everitt has been working hard. For the June quarter MW earned $407,000 (1-c- a share) against a $185,000 deficit in the same period last year. Six months figures showed a loss of $1,375,000 against the $2,503,000 deficit in the first half of 1930. The company's best business is, of course, after harvest.

P: When Pere Marquette Railway reported a loss of $751,000 against a $1,075,000 profit, oldsters recalled that before Pere Marquette received its great motor industry traffic it was called "Poor Marquette."

P: Foreign countries are using fewer bank notes and stamps. Much less stock is changing hands than a year ago. It was not surprising that American Bank Note Co. should earn only $239,000 against $1,461,000.

P: Excellent as is General Motors' management, it has not been able to work its magic upon Yellow Truck & Coach Manufacturing Co. to which the first half brought a $1,046,000 loss against a $1,437,000 profit.

P: A year ago Loft, Inc. lost $260,000 during the half. Since then its new management, under jut-jawed Charles G. Guth, has taken it in hand. The purity of Loft's candies has been strongly advertised, and the value of its $1 dinner. For this half it earned $219,000. The Waldorf System, Inc. (restaurant subsidiary) earned $604,000 compared with $592,000. Bickford's chain showed $372,000 against $328,000.

P: Presumably Allis-Chalmers Manufacturing Co. will eventually benefit from its expansion. But since none of its three major lines (farm implements, electrical equipment, heavy machinery) are depression-proof, it earned only $1,006,000 against $2,351,000.

P: With more people resorting to small loans it was not surprising that Household Finance Corp. should earn $2,116,000 compared with $1,870,000.

P: National Biscuit's showing of $9,406,000 against $10,036,000 was chagrining to the company. It represented only $1.37 a share against dividend requirements of $1.40. And it was the first interruption to the company's upward trend since 1915. A happier showing was made by Loose-Wiles (Sunshine) Biscuit Co. to which the period brought earnings of $1,067,000 against $1,010,000.

P: Two small specialty companies maintained their records for steady growth. Mapes Consolidated Manufacturing Co., maker of egg-flats for shipping eggs, earned $574,000 against $559,000. Telautograph Corp., maker of devices by which messages in handwriting may be conveyed throughout hotels and clubs, earned $184,000 against $170,000.

P: Fat women must have bought more clothing for Lane Bryant, Inc., specialist in coverings for corpulent bodies, earned $181,000 for the six months ending May 31 against a $295,000 profit.

P: General American Tank Car, builder and lessor of freight cars, earned $2,475,000 against $3,653,000. President of the company since last October is young Lester North Selig.

P: The "Bust Trust," or Associated Apparel Industries, Inc. (corsets, brassieres, girdles, underwear) lost $132,000 against profits of $632,000 for six months ending May 31, despite a favorable trend in figure fashion.

P: "Your management feels that you will find this action . . . very gratifying." So last week did Congoleum-Nairn Inc. comment upon its 25-c- dividend, the first payment since 1925. Although Congoleum earned $607,000 against $705,000, its management has paid great attention to its internal condition and now it has current assets 33 times greater than current liabilities, can well afford to be generous. Courageous, the management also bought 251,026 shares of the company's own stock for retirement during the Depression.

Congoleum was formed as Congoleum Co. in 1916. Its chief backer and first vice president was Alfred William Erickson. Up & down Europe it met fierce competition from Sir Michael Nairn of Scotland whose family had been making linoleum since 1847. In 1924, whipped, Congoleum was glad to become Congoleum-Nairn, Inc. Its chairman is now Alfred William Erickson, although his chief interest is the advertising firm of McCann-Erickson. Inc. Vice Chairman is Baronet Nairn, jovial, bushy-mustached, fond of sports. With hat turned far down in front he drives to sporting events in a strange motor wagonette, scrambles onto its roof for a good view. He likes to go through factories notebook in hand. Congoleum-Nairn is thought of as a Morgan company in Wall Street but the connection is not apparent, may exist only in private stockholdings.

P: Many Depression-hit women are buying patterns, making dresses at home. Butterick Co. (Delineator, Adventure, Good Hardware, and patterns) earned $411,000 against $372,000.

P: Food companies held up well. General Foods (Postum, Log Cabin Syrup, Cheek-Neal Coffee, Frosted Foods etc.) showed $10,167,000 against $10,629,000. Beech-Nut Packing (bacon, chewing gum, also a hotel in Rochester, N. Y.) reported $1,172,000 against $1,320,000. Hershey Chocolate's $4,718,000 stood against $4,253,000. During the June quarter William Wrigley Jr. Co. showed a sensational gain from $2,365,000 to $3,057,000. International Salt's first six months' $399,000 compared with last year's $322,000.

P: Lambert Co., which has added toothbrushes, toothpaste, toothpowder & shaving compounds to Listerine, made $3,572,000 against $3,764,000.

P: Some motor companies were badly hit. Hudson's $526,000 compared with $3,392,000. Fierce-Arrow made $421,000 against $1,030,000. Hupmobile lost $1,077,000 whereas in the first half of last year it made $509,000. Chrysler Corp.'s statement was remarkable for the reductions shown in costs and expenses, but its $2,252,000 compared with $3,408,000. Willys-Overland showed great recuperation with $304,000 against $151,000, despite the fact that last year it included $1,400,000 special income.

P: Because Caterpillar Tractor Co. had big orders from Russia and has a large road implement business in addition to farm machinery it was expected to weather the Depression nobly, was a favorite stock even after 1929. But for the half it earned only $1,446,000 against $5,622,000.

P: Although Corn Products Refining Co. was favored by the Government's decision that corn sugar may be used without labels, its half of $5,494,000 compared with $6,641,000. Its smaller rival (and recent legal conqueror) Penick & Ford showed a greater drop with $631,000 against $1,001,000.

P: Baldwin Locomotive Works, suffering from cash-poor customers,"lost $1,775,000 against a profit of $1,807,000. In the same category, General Railway Signal made $752,000 against $1,170,000.

P: There are more fires during Depression, but Seagrave Corp., fire-engine maker, lost $41,000 against a profit of $29,000.

P: Despite a lower dollar sales volume for twelve months ending June 30, Procter & Gamble Co. made $22,650,000 against $22,450.000.

P: A second-quarter loss pulled American Writing Paper's half-year down to $12,648, against $248,512.

P: Cellophane was a timely aid to E. I. duPont deNemours but its half year was $27,610,000 against $32,951,000.

P: General Outdoor Advertising lost $887,000 against last year's $2,684 profit.

P: Useful as washing machines are they are not essential. Maytag Co. was able to make only $470,000 against $1,382,000.

P: Closely owned, Sun Oil Co. has the reputation of being one of the most conservatively managed companies in its field. But for the half year it showed $1,049,000 against $3,658,000. Indicative of what other reports may show, Atlantic Refining Co. lost $4,013,000 against a $2,818,000 profit while American Republics Corp.'s deficit of $1,541,000 compared to last year's profit of $46,000.

P: Lower building volume and a perennially upset industry reduced International Cement's net to $1,000,000 against $2,051,000.

P: A net of $152,000 against $143,000 was the record of Powdrell & Alexander, curtain-makers.

*All earnings are for first half of this year as compared to same period last year unless otherwise specified.

This file is automatically generated by a robot program, so reader's discretion is required.